W.R. Grace & Co. has agreed to pay up to $140 million to settle a class action lawsuit arising out of its use of an attic-insulating product that contained asbestos. The specialty chemicals maker will pay $30 million cash into a trust fund, an additional $30 million cash after three years, and make up to ten additional annual payments of $8 million if certain conditions are met.
This information comes from a filing with the Securities and Exchange Commission. The company sold Zonolite attic insulation, a loose-fill vermiculite product that contains naturally occurring asbestos. Zonolite was installed in millions of homes throughout the U.S. and Canada. As you may recall, the hundreds of thousands of lawsuits involving this product forced W.R. Grace into bankruptcy protection in 2001. Much of the Zonolite manufactured in the U.S. came from a vermiculite mine in Libby, Mont. The Libby mine, which was open for more than 70 years and closed in 1990, has been linked to asbestos exposure that has sickened thousands and killed more than 200 people in the Libby area.
The U.S. Environmental Protection Agency has been overseeing cleanup under the Superfund program since 1999. You may have seen the PBS documentary based on the town’s experience which again put W.R. Grace and the small community in the spotlight. Grace reached an agreement this past August to resolve all asbestos claims against the company, allowing it to emerge from bankruptcy without further obligations for asbestos injury. The payments will be backed by 50.1% of W.R. Grace’s stock. While W.R. Grace stock had traded as high as $30, it was trading at $3.50 just before we sent this issue to the printer.
Source: Associated Press
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